How to avoid a foreclosure?

Below are some tips on avoiding foreclosure.

1. Don’t ignore the problem.
2. Contact your lender as soon as you realize that you have a problem.
3. Open and respond to all mail from your lender.
4. Know your mortgage rights.
5. Understand foreclosure prevention options.
6. Contact a HUD-approved housing counselor.

Once you default on your monthly home loan payments, your lender has the right to start the process of foreclosure. However, even though your bank has initiated the foreclosure process, you do have some options to try during the pre-foreclosure period to try to avoid losing your home.

Notice of Default. The Notice of Default starts the official foreclosure process. This notice is issued 30 days after the fourth missed monthly payment. From this point onwards, the borrower will have two to three months, depending on state law, to reinstate the loan and stop the foreclosure process.